Sponsored by Curbside.
In today’s highly competitive quick-service and fast-casual sector, Generation Z diners are coveted customers. As AccuData reports, this is due in part to the fact that they are on track to become the largest generation of consumers by 2020, accounting for 40 percent of all consumers in the U.S. Gen Z diners have grown up with a mobile phone in hand, and when they want to make purchases, they start with their mobile phones. They often think of local stores as pickup points.
According to an AccuData report, the average Gen Z consumer spends over three hours per day in mobile apps. Think with Google reports that 61 percent of teens shop online because it’s more convenient, more than for any other reason. So doesn’t it make sense to devise a restaurant strategy that revolves around mobile technology?
David Bloom, chief development officer at Capriotti’s, certainly thinks so. This fast-growing, Las Vegas-based fast-casual chain of about 100 locations spread out over 20 states has taken a mobile-first approach to reach Gen Z diners.
“We’re not selling food first and foremost—we’re selling convenience,” Bloom says. And to many consumers, especially Gen Z diners, that convenience means placing an order, driving up to the restaurant, and having food handed to them without ever talking to anyone. “Consumers patronize places that make it much more convenient to access their products,” Bloom says.
The heart of Capriotti’s new convenience strategy is a pickup window. After customers order and pay with the brand’s mobile app, patrons are given the option of receiving their meals at a designated pickup window, where instead of wasting time waiting in the drive-thru queue or getting out of their cars, they simply drive up and drive away with their meal.
Adding this pickup strategy has paid off for the brand. Though Bloom says Capriotti’s did no initial marketing for the pickup window, consumers started using it immediately. “Almost the first day we opened it, people started coming though,” Bloom says. “Apparently there was some pent up demand.”
The pick-up window now makes up 10–20 percent of store sales. “Consumer feedback has been outstanding, and it is already outperforming our initial expectations,” he says. “We are seeing substantial traffic both for lunch and dinner comprised of a wide variety of consumers, including millennials, Gen Z, moms with kids in the car, people that travel for work and eat on the run, catering orders being picked up by administrative assistants, or for parties on weekends.”
Capriotti’s is not alone—Business Insider reports that Taco Bell receives 30 percent higher average order values on mobile orders than in-store orders, and Starbuck’s Mobile Order & Pay platform has already increased company sales and makes up 10 percent of the brand’s transactions at high-volume stores. In fact, the same report says that mobile order-ahead will become a $38 billion industry by 2020 and will make up 10.7 percent of total quick-service industry sales.
Other chains that are exploring the integration of mobile apps with curbside pickup, like Pizza Hut and Boston Market, are turning to Curbside’s ARRIVE location technology, which plugs into retailers' mobile apps to offer cloud-based arrival prediction to operators in each location. The technology alerts kitchen staff when customers approach the restaurant so that food will be fresh and ready when guests pull in. ARRIVE eliminates some of the frustrations restaurants and their customers have experienced in the past with slow service, especially for curbside pickup programs that relied on phone calls or even cameras. These retailers are able to reduce actual wait time, a critical factor for consumers, especially Gen Z.
As the importance of the Gen Z consumer grows, expect more responses from restaurants. Dedicated pickup windows and curbside pickup programs at fast-casual and quick-service restaurants are the early signs of this monumental shift. By eliminating congestion in drive thru and in-store stations, new programs enable sales growth and repeat business from digital consumers, especially the youngest ones. The restaurants that get this right, by offering customers options and serving them quickly, will be well positioned for future growth.
By Gary Elinoff